George Osborne urged to resign after 'scorched earth' referendum campaign

George Osborne is being urged to resign by eurosceptic ministers after being accused of adopting a "scorched earth" policy during the referendum campaign.

Mr Osborne, who on Monday is expected to appear in the Commons for the passing of the finance bill, has indicated that he will stay on and do "all I can to make it work".

The prospect of him remaining as Chancellor until the election of a new Conservative leader has infuriated eurosceptic ministers, who accused him of "scaremongering" and of announcing an "irresponsible" emergency Budget during the campaign.

The Chancellor faced an open revolt from more than 60 Conservative MPs after he threatened an emergency fiscal plan in the wake of a Brexit vote during the final weeks of the campaign, including £30million worth of tax rises or cuts.

Mr Osborne launches the emergency BudgetCredit:
Reuters

65 Tories signed a letter refusing to back Mr Osborne's Brexit Budget in the House of Commons, effectively blocking it because of the party's slim majority.

Iain Duncan Smith, Liam Fox and Owen Paterson, all former cabinet ministers, also signed the letter which warned Mr Osborne's position would be "untenable" if he attempted to carry out the plan.

One eurosceptic minister said: "George is finished. I would be astonished if he stood as a leadership candidate. He is a very astute political operator and I'm certain he can see that it's over."

Another said: "It's going to be difficult for him to be respected and to stay on after what he did during the campaign."

Mr Cameron has vowed not to interfere in Conservative leadership race and views his responsibility as being to "steady the ship" and help ensure an orderly transition.

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07:06

However he has previously tipped Mr Osborne, his close friend, as his replacement. In an interview with the BBC last March Mr Cameron also claimed the Boris Johnson and Theresa May have what it takes to be the Prime Minister.

It followed a surprise announcement that he would not seek to serve a third term in Downing Street if elected.

The calculated decision to announce his plan to serve just two five-year terms as Prime Minister before the General election last year was thought to be a bid by Mr Cameron to persuade voters that he would not go on and on as leader.

However the announcement prompted speculation, which Mr Cameron has repeatedly denied, that he would only serve around half of his second term as Prime Minister and look for a replacement next year.

David and Samantha CameronCredit:
Barcroft

Speaking last year Mr Cameron said: "There definitely comes a time where a fresh pair of eyes and fresh leadership would be good, and the Conservative Party has got some great people coming up - the Theresa Mays, and the George Osbornes, and the Boris Johnsons.

"You know, there's plenty of talent there. I'm surrounded by very good people."

He added: "I've said I'll stand for a full second term, but I think after that it will be time for new leadership.

"Terms are like Shredded Wheat - two are wonderful but three might just be too many."

According to friends he is now considering life as a back-bencher for the remainder of the Parliament. "He loves spending time in his constituency," a friend said.

"He certainly has no intention of returning to front-line politics."

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06:56

Last year Mr Cameron said he would miss being Prime Minister when he decided to step down.

It follows his emotional resignation speech on Friday morning during which he fought back tears.

He has previously said: "I’m putting myself forward for the full five years. I feel fit enough and healthy enough for it. I’ve got a real passion for it."

Mr Cameron is the latest in a line of Prime Ministers who have announced their own resignations rather than be voted out of office.

Tony Blair, the former Labour Prime Minister, announced he would not seek a fourth term in office ahead of the General Election in 2005.

He stepped down in 2007, announcing his Chancellor Gordon Brown as replacement and triggering a byelection in his Sedgefield seat.

Mr Brown lost the election in 2010 to Mr Cameron but did not resign his seat in Parliament until 2014. Instead he joined the backbenches but became notorious for being absent in the Commons.